Russia's Putin seeks gas deal on state visit to China

  • 20 May 2014
  • From the section China

Russian President Vladimir Putin has begun a two-day state visit to China with a major gas supply deal high on the agenda.

A price for the Russian gas was not agreed on Tuesday, but analysts say a deal could still be struck before Mr Putin leaves China on Wednesday.

Mr Putin described China as a reliable friend and Russia's leading foreign trading partner.

It is his first visit to China since President Xi Jinping took office.

Russia's President Vladimir Putin arrives for the fourth summit of the Conference on Interaction and Confidence Building Measures in Asia (CICA) held in Shanghai on 20 May.
Mr Putin is expected to pursue an energy deal with China at the summit in Shanghai

The state visit comes as China hosts a key summit of Asian states in Shanghai that includes delegates from nearly 40 countries and international organisations.

UN Secretary-General Ban Ki-moon is attending, as are the leaders of Iran, Pakistan, Kazakhstan and Cambodia. President Xi is expected to make announcements on security in Asia at the summit.

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Analysis by Carrie Gracie, BBC News, Shanghai

The welcoming ceremony for President Putin was full of upbeat language. He described China as a reliable friend and Xi Jinping promised strategic co-operation.

To underline the point, there were joint naval exercises. But the Russians had raised expectations of the signing of a lucrative 30-year deal to supply natural gas to China. The energy giant Gazprom said they were incredibly close to agreement but clearly the Chinese are driving a hard bargain on price.

The government in Beijing is well aware that after the chill in relations with Europe that followed the Ukraine crisis, Moscow needs to stop depending on the west for 80% of its energy sales. And China does need more and cleaner energy.

But a long history of falling into and out of alliances with Moscow has taught Beijing to keep a hard-nosed focus on its own national interest. It knows Russia needs a friend in the East and it is extracting maximum advantage.

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In an interview with Chinese media before his arrival, Mr Putin called China "Russia's reliable friend" and said the two countries had reached a new stage in bilateral and military ties.

"It would be no exaggeration if I said that the co-operation between our two countries is at its highest level in history," the Russian leader said.

Russia and China have also kicked off a joint military exercise involving their navies.

China's President Xi Jinping (L) is welcomed by his Russian counterpart Vladimir Putin (R) during the opening ceremony of "The Year of Chinese Tourism in Russia" in Moscow, on 22 March, 2013
Mr Xi visited Russia and met Mr Putin on his first foreign visit as China's president in March last year
United Nations Secretary General Ban Ki-moon, left, talks with the Chinese President Xi Jinping during their meeting at the Xijiao State Guesthouse on the eve of the fourth Conference on Interaction and Confidence Building Measures in Asia (CICA) summit in Shanghai, China, on 19 May.
UN Secretary-General Ban Ki-moon (left) met Mr Xi on Monday, before the start of the summit

China is Russia's largest single trading partner, with bilateral trade flows of $90bn (£53bn) in 2013, and the two neighbours aim to double the volume to $200bn by the end of the decade, according to agencies.

Expectations are high that the visit would seal a contract under which Russia's state-owned Gazprom would supply China National Petroleum Corp (CNPC) with natural gas for the next 30 years.

Russia has faced international condemnation for its annexation of Crimea from Ukraine. Russia has also deployed troops near the border of Ukraine, sparking concerns about a possible invasion.

For its part, China has attracted criticism for recent actions in the South China Sea.

China's refusal to move an oil rig stationed in waters claimed by Hanoi sparked an outbreak of protests across Vietnam last week, with demonstrators targeting Chinese workers and Chinese-owned factories. At least two deaths have been reported.

The Philippines has also accused China of building an airstrip on the disputed Johnson Reef.

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